ANZ Bank fiscal study to NZ IAS 1
The aim of NZ IAS1 is to put demands for what a fiscal study should look like ; in footings of the presentation of fiscal statements, guidelines for their construction and the lower limit demands for their content ( NZ IAS 1, para1 ) . The Companies Act 1993 requires companies in New Zealand to maintain fiscal statements that are available free of charge to the stockholders. This is the construct of ‘financial disclosure’ , a company must unwrap any relevant fiscal information, good or bad that it is cognizant of in its set of fiscal statements that might impact stockholders determinations and assist them do an informed determination.
We have assessed the conformity of ANZ Bank Limited ( ANZ ) ’s September 2014 fiscal study to NZ IAS 1. While other criterions may be mentioned, the range of the assignment does non justify their treatment.
ANZ is a taking company in the New Zealand banking market. They are owned by ANZ Funds Pty Ltd, an Australian company who are in bend owned by Australia and New Zealand Banking Group Ltd. The banking group is organized into four major sections ; Retail, Commercial, Wealth and Institutional. ANZ operates throughout New Zealand and they hold about 30 % of the domestic loans ( KPMG, 2013 ) .
ANZ maintained the cardinal subject of ‘strategy’ ; in context of public presentation, advancement ad long-tern ends.
The first emphatic ANZ’s focal point on growing, aiming in the Asian-Pacific part which lead to an addition in net incomes, return on equity and net incomes per portion overall for 2014, with hopes to go on this tendency through to 2016 ( ANZ, 2014, p 18 ) .
The 2nd, adds that conditions in that Asia Pacific were robust in comparing to the planetary economic system. In turn toing this, ANZ has succeeded in constructing a stronger place in the “home markets of Australia and New Zealand” ( ANZ, 2014, p 18 ) . They have focused on “Operations and Technologies” in constructing economic systems of graduated table, which has caused operations volumes to increase piece costs have fallen ; they produce 8m minutess per twenty-four hours and have achieved the effort of an 8 % addition in clients while mean ailments have decreased.
Finally, ANZ are puting and spread outing into different platforms of banking to back up client demands. They aim to present stronger entire stockholder returns with a “target dividend pay-out of 65-70 % of hard currency profit” , by presuming greater efficiency and control over their markets ( ANZ, 2014, p 18 ) .
Analysis and Application of NZ IAS1
Complete set of fiscal statements
Entities under Paragraphs 10 and 10A are required to print a complete a set of fiscal statements. ANZ has complied by including ; a Balance Sheet, Statement of Income and Other Comprehensive Income, Statement of Changes in Equity, Statement of Cash Flows, Notes consisting a sum-up of important accounting policies and other explanatory information, as on page 100. ANZ besides provides comparative information in regard of the old period, and the Balance Sheet as at the beginning of the old period. It should be noted ANZ has used rubrics of their pick, which is permitted and have besides presented the Statement of Profit and Loss individually from Other Comprehensive Income, with net income ( loss ) and other comprehensive income presented in each.
Conformity with IFRS
ANZ has under Paragraphs 15 to 17 reported their statements to reasonably stand for the fiscal place of the entity. They have trustingly recorded passages and followed the definitions set for acknowledging assets, liabilities, income and disbursals in the NZ Framework. ANZ has besides selected and applied accounting policies from the NZ IAS 8 Accounting Policies for particular points that are non covered in the NZ IFRS in Note 1, which gives revelation and presents the information in a manner that is easy to understand, to compare, precise and is relevant.
ANZ besides will necessitate to do an obvious and uninhibited statement of their conformity in the notes. However if they feel like they will necessitate to go from the NZ IFRS to demo just representation they will necessitate to unwrap the information, even if it occurred in a anterior twelvemonth under Paragraphs 20- 23 as they have done on page 91.
Under Paragraphs 25 and 26, ANZ have disclosed their ability to go on the entity in fixing their fiscal statements on a traveling concern footing. This means that they will if there is any concern about factors that may impact the ability to go on or intention to non go on will necessitate to be disclosed in the fiscal statement with grounds as to why they are non regarded as a traveling concern. For dependability intents of the traveling concern premise, directors have to take into history the information from the past histories for the hereafter. ANZ has illustrated this by demoing their income from last twelvemonth and comparing it to the relevant old ages and how it could better in the hereafter on page 8.
ANZ under Paragraphs 27 and 28 is required to make their fiscal statement excepting the hard currency flow in accrual footing and have done so by entering gross when they are earned it and non when hard currency is been received. ANZ besides recognizes characteristics of the fiscal statements merely when the meet the standards for the definition and acknowledgment of those elements in the NZ model ; all assets, liabilities, equity, income and disbursals.
Frequency of Reporting
NZ IAS1 provinces in Paragraph 36 that an entity should show their fiscal statements at least one time a twelvemonth. ANZ’s fiscal statement was prepared for the twelvemonth ended 30 September 2014, and the old financials were released for the period ended 30 September 2013. Each twelvemonth the company let go of a new set of fiscal statements, therefore following with NZ IAS 1, Paragraph 36.
NZ IAS1 states that the fiscal statements of a company should hold comparative information, for readers to compare informations in regard to the old fiscal period. Under Paragraph 38, the sum-up of fiscal statements on page 3 of ANZ’s study shows that each categorization has comparative figures from old old ages to do opinion on the company public presentation with. Paragraph 39 requires at least two fiscal statements, and ANZ have complied by supplying two to five old figures throughout their study.
Designation of Financial Statements
NZIAS 1, paragraph 49 to 53 relate to the designation of fiscal statements. Paragraph 49 provinces that the entity should clearly place the fiscal statements from the other information given so that users can separate what has been prepared capable to NZ IAS1 and what is auxiliary information. Paragraph 51 provinces that the fiscal statements should hold certain information about the company clearly identifiable, besides whether the notes are for a individual entity, the day of the month the coverage period screen, the currency used and the degree of rounding used.
ANZ have provided a tabular array of contents on the gap page which lists the fiscal statements contained in the study and so the notes and other auxiliary information that relates to their operations. They besides mention “there is no information to be provided in this one-year study other than the fiscal statements and the audit study on those statements” ( ANZ, 2014, p 1 ) , satisifying the demands of Paragraph 49.
The one-year study contains an Income Statements ( page 101 ) , Statement of Comprehensive Income ( page 102 ) , Statement in Changes in Equity ( page 105 ) , Balance Sheet ( page 103 ) , Cash flow Statement ( page 104 ) and the Notes ( page 106 ) , all of these fulfilling Paragraph 51 ( a ) . The Cover page states the Annual Report has been prepared for ANZ Bank NZ Limited, and it is for the twelvemonth ended 30 September 2014, fulfilling Paragraph 51 ( B ) , and 51 ( degree Celsius ) . Page 106 under Note 1 ( a ) ( eight ) they have commented that the fiscal statements are presented in New Zealand Dollars, therefore adhereing to Paragraph 51 ( vitamin D ) . Note 1 ( a ) ( V ) mentioned that all the figures are rounded to the nearest million dollars, unless stated otherwise, fulfilling the demand under Paragraph 51 ( vitamin E ) , and Paragraph 53, which province they must unwrap the degree of rounding.
Statement of Financial Position
NZIAS 1 sets out the guidelines for a Statement of Financial Position from Paragraph 54 to 79.
Paragraph 54 relates to what is required as a lower limit in a statement of fiscal place, as applied to ANZ’s conformity below in the Balance Sheet on page 6:
- Property, Plant and Equipment is shown as Premisess and Equipment ;
- Investing Property is non mentioned in the Financial Statement ;
- Intangible assets are shown ;
- Fiscal assets are shown ;
- Investings are shown ;
- Biological assets are non mentioned ;
- Inventories are besides non mentioned ;
- Trade and other receivables are mentioned as Net Loans and Advances ;
- Cash and Cash Equlivents are mentioned ;
- Entire assets have been summurised ;
- Trade and Other Payabless are listed under Liabilitiess as Deposits and Other Borrowings ;
- Commissariats are mentioned ;
- Liabilitiess have been totaled up ;
- Liabilitiess and assets are both represented ;
- Deferred Tax assets are listed under Assetss and Deferred Tax Liabilitiess are listed under Liabilitiess ; and
- Liabilites included in disposal groups is non mentioned.
Paragrapha 55 and 56 relate to the presentation of the Balance Sheet and the seperation of headers of each categorization. ANZ’s Balance sheet complies as it is seperated into Assetss, Liabilitiess and Equity.
Paragraphs 60 to 76 relate to the categorization of current and non-current liabilities or assets. The definitions of an current and non-current plus and current and non-current liability are given within them. ANZ have defined what a current and non-current assets and liabilities are and so seperated them, under Note 24, satisifying these demands.
Paragraphs 77 to 79 relate to the information to be presented in the Balance Sheet or Notes. It states that the entity needs to demo how many portions have been authorised, to the full paid, the value of the portions and if there are any penchant portions or particular portions. ANZ under Note 25, have listed the figure of portions in units and dollars, and depict the penchant portions and dividend policy.
Statement of Comprehensive Income
ANZ has complied with Paragraph 81A by showing the followers:
- ANZ’s net income for the period was 3,885m
- ANZ’s comprehensive income was 664m.
- ANZ’s entire comprehensive income was the period was 7,947m.
ANZ has besides included the figure in ( I ) in their condensed amalgamate statement of comprehensive income, which is presented individually from their condensed amalgamate income statement, on pages 101 and 102 severally.
ANZ has complied with Paragraph 81B through both their condensed amalgamate statement of income and comprehensive income attributed to:
- A certain period of September 2013 and 2014.
- A section of their net incomes to “non-controlling interests” .
- A section of their net incomes to “shareholders of the company” .
ANZ in conformity to Paragraph 82 has listed the following information in presentation in the net income and loss subdivision on their Income Statement in on Page 101:
- Gross: Net Interest Income and Others as elaborated in Note 2.
- Finance Costss as Interest Expense
- Share of Net income as Share of associates’ net income
- Tax disbursal of ( 1,702m ) as elaborated in Note 4.
ANZ, under Paragraph 82A has listed the following information in presentation in the sums on their Comprehensive Income Statement in on Page 102 sing points reclassified later in net income and loss:
- Items will non be reclassified: “measurement addition ( loss ) on defined benefit plans” , “fair value addition ( loss ) due to alterations in won recognition risk”
- Items that may be reclassified: i.e. “foreign currency interlingual rendition reserve” .
ANZ under Paragraph 85, has presented extra line points, headers and subtotals in both their statements where relevant to understanding. They have separated constituents within the statements through headers and used column format for comparative analysis.
ANZ has recognised all points of income and disbursals in the period till September 2014 as seen in Notes 2 and 3 from page 107 ( income ) , and page 108 ( runing disbursal ) with the exclusion of those that are allowed to be excluded under an NZ IFRS.
Paragraph 90 is met by unwraping on page 109, the income revenue enhancement disbursal as a Note 4. They complied by showing points of other comprehensive before income cyberspace of revenue enhancement, which is aggregated to associate to those points and has farther adhered to the subdivision by apportioning “income tax” between the points that may non and might be reclassified subsequent to the net income and loss subdivision i.e.11m for the former and 23m and 41m for the latter. Through dividing Notes 2 and 3, ANZ has listed material income and disbursals individually.
ANZ has complied with Paragraph 98 by individually unwraping the disbursal of Restructuring on Note 3.
Sing Paragraphs 99 and 102 to 105 ANZ has aggregated disbursals utilizing the ‘nature-based’ categorizations incurred as can be seen in Note 3. For illustration, disbursals are grouped to “Personnel” , “Premises” etc. This is the method that might be most relevant as it might hold provided information for faithfully as the ‘cost of sales’ method is non applicable due to the nature of the entity, being a bank.
Statement of Changes in Equity
ANZ has included their Statement of Changes in Equity on page 105 of their prospectus, among others, in conformity with Paragraphs 106 and 10 ( degree Celsius ) .
ANZ’s statement has distinguished each separate subdivision of equity owned such as ordinary and penchant portions, militias and maintained net incomes from non-controlling involvement with entire comprehensive income for the period given for each where applicable ; parent involvements has retained net incomes and shareholder’s equity attributable to holders of bank has a sum of 7,278m and 7,931m severally while non-controlling involvements has a sum of 16m.
A rapprochement between the transporting sum at the beginning and the terminal of the period has besides been presented from October 2012 and September 2013 with September 2014. ANZ has individually disclosing alterations ensuing from:
- net income ( loss ) and other comprehensive income for each period stated above ; and
- minutess with proprietors in their capacity as proprietors: ANZ has shown individually parts by and distributions to proprietors ( i.e. dividends ) and alterations in ownership involvements in subordinates ( i.e. Group redemption options ) that do non ensue in a loss of control.
ANZ complies with Paragraph 106A by entering dividends paid to each separate constituent within the statement itself adding to a amount of shareholders’ equity to 4,701m.
Statement of Cash Flows
ANZ has provided a Cash Flow Statement for the intent listed in Paragraph 111 ; to measure their ability to bring forth hard currency and hard currency equivalents and the demands of the entity to use those hard currency flows” . ANZ would be farther necessitate to follow with farther demands set out by NZIAS 7.
ANZ adheres to Paragraph 112 as it has presented information on the “basis of preparation” to the fiscal statements within Note 1 on page 106, in which subdivision ( I ) contains accounting policies. It has besides disclosed the information required by NZIFRSs and non present elsewhere in the fiscal statements but relevant to their apprehension from Page 108 onwards.
Under Paragraph 113, ANZ has cross-referenced notes where necessary in an effort to show their notes in a systematic mode utilizing a ‘Note’ column within fiscal statements with matching Numberss.
Under Paragraph 114, ANZ has non presented an “explicit and unreserved” statement of conformity with IFRS under Paragraph 16, deducing that they have non complied with all the demands of IFRS. As mentioned earlier ANZ has given a drumhead pf accounting policies applied within Note 1 which will be farther discussed in Disclosure of Accounting Policies. Under Paragraph 116, in exerting Paragraph 16, ANZ has on Note 1, farther separated per fiscal statements, the information sing footing of readying and specific accounting policies.
ANZ has besides given back uping information for the Statement of Financial Position ( Notes 7 to12 ) and Comprehensive Income ( Notes 2 and 3 ) , but besides for Statement of Changes in Equity ( Note 12 ) and Cash Flows ( Notes 13 ) and have been presented in the order of the statements themselves. Note 16 consists revelations of contingent liabilities and assets assumed to be in conformity with NZ IAS 37, non discussed within the range of this assignment.
Under Paragraph 115, ANZ has therefore, far retained a systematic construction for the notes as far as operable but may hold changed specific order of points within the notes where necessary. For illustration, Note 17 is invariably brought up due to alterations in comparative information holding occurred as a consequence of acceptance of new accounting criterions or being reclassified to conform to current fiscal statement presentations.
Disclosure of Accounting Policies
Under Paragraphs 117 to 124, ANZ has disclosed information relation to the fiscal statements. For illustration their measurement footing used is historical cost with exclusion to assets or liabilities stated at just value, under Note 1 ( II ) .
Information that would hold been used that is relevant to the apprehension of the fiscal statements such as policies that were used is given under Note 1 ( I ) . These policies and revelations are given to help user’s apprehension of all the statements and minutess. ANZ has besides disclosed the procedure of using their accounting policies that have had important consequence on the sums recognised in the fiscal statements such as usage of estimations, premises and opinions under Note 1 ( III ) .
We have assessed the conformity of ANZ Bank Limited ( ANZ ) ’s September 2014 fiscal study to NZ IAS 1. Our findings show that ANZ has largely complied with the criterions, with the exclusion of some points on their Balance Sheet. It was besides found that ANZ has non made an “explicit and unreserved” statement of conformity with IFRS, deducing that they have non complied with all the demands of IFRS. This may non ensue in just representation of the company’s minutess but besides may impede user apprehension.
A restriction of this essay is the restricted to merely NZ IAS 1, and found we may hold gained a better apprehension and assessed ANZ’s conformity with more truth in farther treatment of other NZ IAS and NZ IFRS.
Overall, we found ANZ’s study satisfied the aims of NZ IAS1 in being consistently structured, easy to voyage and will function to heighten the user apprehension of the company.
WORD COUNT: 2999
ANZ Financial Report. ( 2014 ) .Amalgamate Financial Report. Dividend Announcement and Appendix 4E: Full twelvemonth 30 September 2014.Retrieved from hypertext transfer protocol: //companyresearch.nzx.com.ezproxy.waikato.ac.nz/deep_ar/newpage.php? pageid=arep & A ; default=ANBHA
Companies Act 1993. Retrieved from
hypertext transfer protocol: //www.legislation.govt.nz/act/public/1993/0105/latest/DLM319570.html
KMPG FIPS Quarterly, June 2013. Retrieved from www.kpmg.co.nz
NZ IAS1, N.Z. ( 2010 ) . Retrieved from hypertext transfer protocol: //www.xrb.govt.nz/Site/Accounting_Standards/Current_Standards/Standards_for_For-Profit_Entities/Stds_for_For-Profit_Entities_T1-4.aspx